Rainmaker, Rents, PhD’s, and Donald Trump

Here is one of the original press releases on Rainmaker, from 2007, one of the companies that uses computer programs to calculate apartment rents. Even if your city has built “affordable housing,” it is likely that such housing is no longer affordable, since computer programs raise apartment rents above their true market value, as I wrote in a series of posts. In this Rainmaker press release, the company hired PhD’s in mathematics to develop their programs in 2007. Donald Trump is a client, buying the program to set his hotel rates.

Note below the following key phrase, indicating that this is all about speculation –

ATLANTA, GA, May 8, 2007 – The Rainmaker Group, the world leader in automated revenue management software and services to the multi-family housing and casinogaming hotel industries for total property profitability, announced it is releasing Version 8.0 of its revolution LRO SMLease Rent Options system to deliver maximum profit lift for its multi-family housing clients. Version 8.0 enhancements include a new user interface that delivers expanded performance information and enhanced navigation and drill-down capability to view and analyze data more easily for profitable business decisions. The new version is also fully Excel compatible for simplified data sharing.The Rainmaker Group credits its Ph.D. product design team of Dr. Jian Wang, vice president research & development and Dr. Ahmet Kuyumcu, chief scientist, for Version 8.0’s core functionality. Dr. Kuyumcu said, “The multi-family housing industry is a new frontier for the application of pricing and revenue management and provides many unique modeling challenges. These include low data volume, numerous lease term alternatives, different pricing requirements for new leases and renewals, early lease terminations, and significant vacancy and make-ready costs.” Dr. Kuyumcu stated that Rainmaker employs sophisticated pricing-science techniques such as hierarchical modeling, business statistics estimation with cross-validation, demand and supply forecasting, dynamic reference rent calculation, and quadratic programming to address multi-family housing (MFH) business challenges..

Bruce Barfield, Rainmaker Group principal, said, “Jian Wang and Ahmet Kuyumcu have done a great job applying Ph.D.-level mathematics to business-process modeling for the multi-family housing and casino hotel industries. Their work is resulting in more profitable lease/rent and room rate pricing for Rainmaker’s clients. Both Jian and Ahmet were on the original development team for our LRO and gaming hotel revenue management systems and their ongoing theoretical work is delivering concrete financial results today.” Barfield stated that although there is plenty of advanced mathematics behind LRO, users report the new screens and dashboards make the system easy to use and to apply pricing trends and recommendations.The Rainmaker Group enhanced its revolution LRO system by employing a new tool set. The new Version gives users full access to all system information and provides simplified screen presentations enabling fast access to 12 months of performance data for more accurate forecasting and strategy evaluation. In LRO Version 8.0 data may be viewed on-screen in many customized formats to reduce dependence on hardcopy reporting. The new version is fully compatible with Microsoft Excel enabling managers to distribute information to all stakeholders in a familiar spreadsheet format for wider executive lease/rent optimization strategy collaboration.

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Bruce Barfield, Principal at
The Rainmaker Group.

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Revolution LRO uses sophisticated mathematics to determine optimal lease/rent pricing based on competitive influences, historical performance and other factors and recommends pricing for any given move-in date, unit and lease duration. Powerful statistical modeling tools developed by Dr. Wang and Dr. Kuyumcu instantly perform the millions of calculations necessary for enterprise-wide forecasting and rate-setting across dozens of unit types to deliver updated rate recommendations as market conditions change. Leading multi-family firms credit revolution LRO with raising lease/rents as much as 20 percent.About Rainmaker Group

The Rainmaker Group is a software and services company that provides, implements and supports the revolution LRO profit optimization solution that enables multi-family housing operators to maximize revenue from apartment leases. revolution LRO lease rate improvement results have been reviewed and validated by independent accounting firms. For over five years revolution LRO has delivered optimized leasing rates to the largest operators in the industry including Archstone-Smith, Equity Residential, Post Properties, Simpson Housing, Mid-America Apartment Communities and a number of other leading multifamily housing companies.

The Rainmaker Group also provides the revolution product suite, powered by JDA, that maximizes total property profitability for operators of casino hotels and other hospitality enterprises. The company enables clients to identify and maintain availability for their most profitable revenue sources through revenue management implementations. The Rainmaker Group helps casino hotels increase profitability through the accurate, instantaneous ability to determine the minimum acceptable value of each guest. This increases client profitability by securing the most profitable customers while developing more effective business processes. Hospitality clients include Boyd Gaming, Harrah’s Entertainment, Omni Hotels, IP Casino Resort Biloxi, Trump Entertainment Resorts and other leading hotel companies. The Rainmaker Group incorporated in 1998.

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How King County Makes Housing Unaffordable, and Punishes Farmers Outside the Urban Growth Boundary –

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